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US transport company Forward Air is considering a potential sale or merger as part of a review of its financial performance and value.
The Forward Air board of directors will consider options including a sale, merger or another strategic or financial transaction “to maximize shareholder value”.
Last year, the provider of transportation services across the US, Canada and Mexico acquired Omni Logistics, a global multimodal provider of air, ocean and ground services.
In January 2024, Forward Air and Omni Logistics agreed to end a legal dispute over Forward Air’s planned acquisition of Omni. The acquisition agreement between the companies was announced in August 2023, however, Omni Logistics later filed a lawsuit against Forward Air in a bid to enforce the agreement.
Forward Air then filed a counterclaim against Omni’s lawsuit. Forward claimed that Omni had not complied with obligations under the Merger Agreement and it therefore wanted to scrap the deal.
George Mayes, independent chairman of the board of directors, said: “Under Forward Air’s new leadership team, the Company is making tangible progress executing the Omni integration and delivering on synergy targets ahead of schedule, while stabilising the business and advancing the early stages of transforming the company to become a global logistics powerhouse through the implementation of its strategic plan.
“While this work is underway, the board and management team have been actively analysing the business and strategy to ensure the Company pursues the best path forward to enhance shareholder value. To be comprehensive in its assessment of value creation opportunities, the board has initiated this exploration of strategic alternatives and is committed to pursuing a path that will maximise shareholder value.”
According to Forward Air, the board has not set a timetable for the conclusion of this review.
Additionally, the company has reduced its credit facility commitments from $340m to $300m. Forward expects full year 2024 consolidated EBITDA to be in the range of $300m to $310m.
As part of its transformation strategy, in the fourth quarter of 2024 the company took steps to cut operating expenses, including reducing its workforce, consolidating terminal operations and reducing the use of third-party vendors.
These efficiencies are expected to result in approximately $20m in savings on an annualised basis, said Forward Air. These savings are incremental to the $75m in synergies from the Omni integration, which are on track to be achieved by the end of the first quarter of 2025.
